Smith v. Freeman, 01583

• Decision Date: 26 December 2002
• Docket Number: No. 01583,01583
• Citation: 149 Md. App. 1,814 A.2d 65
• Parties: Alyson Victoria SMITH, v. Antonio Michael FREEMAN.
• Court: Court of Special Appeals of Maryland

814 A.2d 65

149 Md. App. 1

Alyson Victoria SMITH, v. Antonio Michael FREEMAN.

No. 01583, Sept. Term, 2001.

Court of Special Appeals of Maryland.

December 26, 2002.

David P. Sutton, Baltimore, and Ralph W. Powers, Jr., Upper Marlboro, for appellant.

Bonnie J. Butler (Butler & Robinson, P.A., on the brief), Baltimore, for appellee.

Argued before HOLLANDER, SALMON and PAUL E. ALPERT (Retired, Specially Assigned), JJ. HOLLANDER, Judge.

This appeal arises from a request for modification of child support filed by Alyson Victoria Smith, appellant, against Antonio Michael Freeman, appellee. The parties, who were never married to each other, are the parents of five-year-old Gabrielle Marie Smith Freeman. In essence, the dispute centers on the question of an appropriate child support award when: 1) the non-custodial parent is a wealthy professional athlete whose current salary far exceeds the maximum income to which the child support guidelines apply, but whose career expectancy is limited; 2) the parties were never married to each other; and 3) the wealthy father has provided substantial support pursuant to an agreement, in an amount that exceeds the child's day-to-day expenses, but his income has grown substantially since the parties reached that agreement.

On October 1, 1998, the Circuit Court for Anne Arundel County entered a consent order that resolved issues related to child custody and visitation. Shortly thereafter, the parties reached an agreement concerning child support; among other things, appellee agreed to pay $3500 a month to appellant. At that time, appellee earned an annual salary of about $1.2 million as a football player with the Green Bay Packers.¹ Two years later, when appellee's annual salary soared to $3.2 million, appellant sought an increase in child support. After a hearing in July 2001, the circuit court rejected appellant's position that she is entitled to an increase in child support even though appellee's income has tripled. It concluded that there has been no change in the child's needs, and therefore appellant is not entitled to an increase in child support.

This appeal followed, in which appellant presents two questions for our consideration:

I. Whether the circuit court abused its discretion in holding that a large increase in the income of the father, a professional athlete, did not warrant an increase in child support.

II. Whether, in denying the increase, the circuit court misapplied the legal standards relating to the child support obligations of a high income parent with a vast wage increase in the course of a short career expectancy.

For the reasons discussed below, we shall vacate the circuit court's order and remand for further proceedings.

FACTUAL SUMMARY

Gabrielle was born to the parties, out of wedlock, on March 13, 1997. Although the parties share joint legal custody, appellant has primary physical custody of the child. Appellant is currently married and has another daughter.²

There is no suggestion that appellee has been a proverbial "deadbeat dad." To the contrary, pursuant to an agreement between the parties dated November 20, 1998 (the "Agreement"), appellee assumed responsibility for the financial support of Gabrielle. At the time, appellee earned an annual salary of $1.2 million, and he agreed to pay $3500 per month in child support until the child reaches the age of eighteen. In addition, appellee agreed to pay for Gabrielle's private school education through twelfth grade, inclusive of any attendant costs, such as uniforms and books; health insurance until Gabrielle reaches the age of twenty-one; all health care expenses not covered by insurance, such as orthodontia; and to establish a college fund of at least $100,000, through four successive annual payments of $25,000, with the first payment due in 1998. Freeman also agreed to secure a life insurance policy of $500,000 for the benefit of Gabrielle, designating her as the sole irrevocable beneficiary, with the funds to be used for the support of the child in the event of appellee's death. Further, appellee agreed to a one-time provision of a car to appellant, valued at $17,500, so that appellant could safely transport Gabrielle.

On October 10, 2000, some two years after the parties executed the Agreement, appellant filed the motion to modify child support. Claiming that appellee's income had climbed to about $3.2 million per year, she sought an increase in support.

At the motion hearing held on July 9, 2001, the parties proceeded largely by stipulation and argument, with brief testimony from appellant. They stipulated that, when the Agreement was executed, appellee was earning about $1.2 million, and that his income subsequently increased to $3.2 million. In addition, the parties stipulated that the Green Bay Packers had the right to "cut him this season if he doesn't perform or if he gets hurt." In that event, according to appellee, his salary would revert to $1,000,000. Further, the parties agreed that appellee enjoyed a gross monthly income of $258,000.00.³ On an annual basis, appellee's monthly child support payments of $3500 amounted to $42,000. Coupled with appellee's monthly payment of $516.66 for tuition, Freeman had a combined monthly child support expenditure of $4016.66.

Further, the parties agreed that appellant was attending school and was unemployed. Appellant's financial statement showed that the child support payments were her only source of income.⁴ On her financial statement, appellant listed the following monthly expenses for Gabrielle, some of which represented the child's pro rata share: Mortgage—$700⁵; Utilities— $250; Telephone—$100; Food—$300; Clothing—$900; Medical and Dental— $350; Transportation—$400; Life Insurance—$75; Health Insurance—$50; Auto Insurance—$50; Child Care Expense— $497; Recreation—$750; and Incidentals—$500. Thus, appellant claimed total monthly expenses for Gabrielle of $4592, or $55,104 per year.

Appellee's counsel asserted that Mr. Freeman had been supporting his daughter generously. She claimed that, if the court were to increase the amount of child support, appellee would actually be "supporting the mother...."

The court found a material change of circumstances based on appellee's increase in income since 1998. The court said:

All right, well let me say the Court has already, from the discussions with counsel in chambers, been giving this issue some thought and it does seem to me that there is no doubt but that there is a material change of circumstances in that Mr. Freeman's income has tripled.

Nevertheless, in an oral opinion, the court denied appellant's request for a modification of child support. The court's decision was predicated on several grounds.

The court observed that, at the "top" of the Guidelines, for one child, the maximum amount of monthly child support was $1040, exclusive of additional entitlements for certain extra expenses, such as child care. Thus, it pointed out that appellee was currently paying more than double that amount, pursuant to "a very generous [A]greement." The court was also satisfied that the Agreement "provides for the full needs" of the child. Recognizing that it had discretion with regard to the child support award, the court considered the issue of the child's needs as the proper "approach" to determine the amount. It said:

Now, under the case law, once you get to the top of the [Guidelines] chart, it is in the Court's discretion as to whether it would be in the best interest of the child to go above and beyond that and in [Voishan v. Palma], they suggest ways that the Court could approach it and obviously one of the ways the Court could approach it is in a financial statement, a statement of needs for the child.

(Emphasis added).

In addition, the court attached weight to the parties' 1998 Agreement, despite the fact that appellee's income had almost tripled since the time that the Agreement was executed. The court said:

Even though the Court may find that it is off the chart, I think it is a factor for the Court to consider which is the terms of the parties' agreement. We start with a presumption that when the parties' make an agreement, that their agreement is reasonable and in the best interest of the child. I have reviewed the agreement in this case. The agreement is one which makes many provisions, including for trust funds for the child for education, including the payment of uninsured health costs and it is a very extensive and very well thought out agreement and it is difficult for me to say that it, per se, is not in the child's best interest.

Focusing again on the child's needs, the court also said:

The argument could be made on a policy basis that if one parent has income which is rising substantially, that as the saying goes, when the tides rises, all boats are lifted, that the child should benefit automatically simply because one parent's income has risen substantially.

However, I think that there is also the countervailing argument on the other side, as expressed by [appellee's attorney], that the point of child support is to take care of the needs of the child and not necessarily to take care of the needs of any other member of the household where the child lives.

(Emphasis added).

With regard to the child's expenses and needs, the court was of the view that certain expenses claimed by appellant were excessive or unnecessary, notwithstanding Gabrielle's status as the daughter of an acclaimed and wealthy football player. The court said:

So that brings me to the financial statement which is Exhibit 1 and I see in this financial statement that it does have the statement of the child's needs. It is always a difficult matter to say of a house payment how much should be attributed to a child, so I have no problem with $700 for that. I have no problem with utilities, the telephone, the food. I do have a question about the clothing. Nine hundred dollars per month for clothing is an...